UPDATE 1-AngloGold Ashanti says strikes could lead to cuts

Published 10:41 PM ET Sat, 10 Nov 2012

(Adds background)

JOHANNESBURG, Oct 1 (Reuters) - World No. 3 gold bullion producer AngloGold Ashanti warned on Monday that an illegal strike could lead to cuts in its South African operations earlier than expected and raised the possibility that strikers could be sacked.

Gold mining in South Africa is generally on the decline as resources that have been mined for decades run out. AngloGold said 24,000 of its 35,000 workers have been on strike for a week.

"If the current unprotected strike continues, it compounds risks of a premature downsizing of AngloGold Ashanti's South African operations," chief executive Mark Cutifani said in a statement.

"Clearly for South Africa's gold sector, as for many others, there is a very clear trade-off between investing in the sustainability of our business and employment."

He added the company could take action, potentially including dismissals, against striking employees.

"If we have to do something, we will. We will take those actions if and when they are appropriate," he said in response to a question from a reporter.

AngloGold's South African operations accounted for 32 percent of the group's production in the first half of 2012 and the company said it was losing around 32,000 ounces of production a week due to the strike.

A wave of wildcat strikes is disrupting South Africa's mining sector.

It has been fueled by the decision of platinum producer Lonmin to give pay rises of up to 22 percent to end an illegal strike accompanied by labour strife in which 46 people were killed.

Discontent has led to stoppages at AngloGold's rival Gold Fields , Anglo American Platinum and smaller mining operations.

AngloGold, which already has a two-year wage agreement in place, said it was willing to bring forward the next round of wage negotiations but it would not reward broken commitments, violence and threats of intimidation. ($1 = 8.2512 South African rand)